EGBs-GILTS CASH CLOSE: German Short End Outperforms Amid Broader Weakness

German bonds outperformed through the 10Y segment while the UK long end outperformed Thursday.

• High German state inflation triggered Bund losses early, which carried through to on the national September CPI release in the afternoon coming in at 10% Y/Y vs expectations of 9.5% coming into the session.
• Several ECB speakers reiterated that a 75bp hike was likely in October, though the terminal rate dipped 3bp to the lowest since Sep 23 under 2.90% and Schatz outperformed.
• Long-end Gilt yields fell sharply alongside a GBP rebound on news that the OBR could get a full fiscal forecast by end-Oct. The BoE's bond buying op saw fairly low takeup again (GBP1.5bln), while appearances by Ramsden and Pill brought little new.
• BTP spreads widened as Reuters reported the ECB saw no need to activate TPI to cap Italian yields.

Closing Yields / 10-Yr Periphery EGB Spreads To Germany

• Germany: The 2-Yr yield is down 3.8bps at 1.818%, 5-Yr is up 1.4bps at 2.042%, 10-Yr is up 7.3bps at 2.193%, and 30-Yr is up 14.4bps at 2.161%.
• UK: The 2-Yr yield is up 10.9bps at 4.402%, 5-Yr is up 15bps at 4.442%, 10-Yr is up 13.5bps at 4.147%, and 30-Yr is up 3.6bps at 3.968%.
• Italian BTP spread up 6bps at 246.9bps / Spanish up 0.7bps at 118.7bps